Brexit VAT & import duties refund on returns or own goods

Following the UK’s exit from the EU, many ecommerce businesses are struggling with the cost of import VAT, customs duties or excise duty on goods returned by customers.  However, it is possible to avoid these charges and ensure a good customer experience. This process can also cover ‘own goods’ which are brought back into the UK or EU. Review our Brexit VAT checklist for all issues to think about for EU-UK trade.

Returned Goods VAT and tariffs relief

Businesses may reclaim import VAT and customs duties on reimports where the goods are largely unaltered. The relief also covers partial reimports – so partial returns of consignments are included. Generally, this may be done up to three years from the original export – thus covering all e-commerce returns.

How to reclaim VAT and duties

To reclaim tariffs or import VAT on reimports, you will need to produce the original export declaration (form C88) and complete special reclaim forms (C1314 and C&E 1158) available from the UK or EU tax authorities. These details the goods, commodity codes and any changes to the goods which may affect the right to reclaim import taxes.

For ecommerce sellers with regular returns, it is recommended you contact the tax authorities who should be able to offer alternative refund measures to speed-up the refunds.

Goods imported by post

The seller should ask their customer to write ‘Returned goods - relief claimed’ clearly on the package and its accompanying customs declaration. The declaration must include a complete and accurate description of the goods, their quantity and value. If the seller is registered for VAT, make sure your VAT number is quoted on the declaration (CN 22 or CN23). You may use form C1309 to declare returned goods relief on postal importations to the tax authorities.

Record keeping requirements

Sellers making reclaims must keep the following documents for at least four years:

• any National Imports Relief Unit acknowledgement letters
• receipts
• bills
• invoices
• insurance documents